IMI reports robust growth in first half

26th Jul 2024 07:18

(Sharecast News) - IMI reported continued strategic progress and a robust financial performance in its first half on Friday, with growth in organic revenue and profits.

The FTSE 100 engineering company announced a 10% increase in its dividend and a £100m share buyback, alongside reconfirming its full-year adjusted earnings per share guidance.

On an adjusted basis, IMI reported revenue of £1.098bn, up 1% overall and 5% organically.

Operating profit reached £196m, marking a 2% increase, with a 6% rise organically, while the operating margin improved by 10 basis points to 17.9%.

Profit before tax rose 4% to £187m, and basic earnings per share increased 1% to 54.7p.

Operating cash flow fell 11% to £130m, while the dividend per share was raised to 10p, reflecting a 10% increase.

The statutory results also showed strong performance, with revenue rising 1% and statutory operating profit surging 19% to £177m, with an operating margin of 16.1%, up 240 basis points.

Statutory profit before tax climbed 17% to £163m, and basic earnings per share rose by 14% to 48.2p.

However, operating cash flow slightly decreased by 2% to £170m.

IMI said its complexity reduction programme yielded £4m in benefits during the first half.

"We continue to make good progress delivering our purpose-led strategy, 'breakthrough engineering for a better world'," said chief executive officer Roy Twite.

"First half performance was in line with expectations, and we were pleased to deliver 5% organic sales growth and 6% organic adjusted operating profit growth, despite mixed end markets.

"In line with our disciplined approach to capital allocation, we are today announcing a £100m share buyback programme and a 10% increase to the interim dividend."

Twite said that based on current market conditions, the company still expected full-year adjusted basic earnings per share would be between 120p and 126p.

"After nearly 10 years with IMI, Daniel Shook, group chief financial officer, has decided for family reasons to step down from the IMI board in 2025.

"Dan has been a fantastic partner to me over the last five years.

"We are also pleased to announce the appointment of Jackie Hu as chief operating officer, reporting to me and driving the growth of all five sectors."

At 0904 BST, shares in IMI were up 1.39% at 1,827p.

Reporting by Josh White for Sharecast.com.